Helios Technologies(US:HLIO)2025-05-06 20:44Financial Performance - First quarter net sales were $195.5 million, down 8% year-over-year, with Hydraulics segment sales declining 11% and Electronics segment sales down 1%[4] - Diluted EPS for the first quarter was $0.22, a decrease of 21% year-over-year, while diluted Non-GAAP EPS was $0.44, down 17% from the prior year[4] - The company reported a net income of $7.3 million for the first quarter of 2025, down 21% from $9.2 million in the first quarter of 2024[32] - Operating income decreased by 16% to $17.0 million in the first quarter of 2025, compared to $20.3 million in the same quarter of 2024[32] - The gross margin for the first quarter of 2025 was 30.6%, down from 31.7% in the first quarter of 2024[32] - The company achieved a GAAP net income of $7.3 million, translating to a net income margin of 3.7%[44] - Non-GAAP adjusted net income for Q1 2025 was $14.8 million, or $0.44 per diluted share, compared to $17.6 million, or $0.53 per diluted share in Q1 2024[44] Cash Flow and Debt Management - Cash generated from operations was $19.0 million, up 7% compared to the same period last year, with an 11% reduction in inventory across all businesses[4] - Total debt was reduced by $75.7 million, or 15%, to $445.6 million, marking the seventh consecutive quarter of debt reduction[4] - The net debt to adjusted EBITDA leverage ratio improved to 2.7x from 3.1x in the prior year period[4] - Cash flows from operating activities increased to $19.0 million, compared to $17.8 million in the same quarter last year[36] - Cash and cash equivalents at the end of the period were $45.9 million, up from $37.3 million at the end of the same quarter in 2024[36] - The net debt as of March 29, 2025, was $399.7 million, with a net debt-to-adjusted EBITDA ratio of 2.7[51] Operational Efficiency - Operating income increased by 23% compared to the previous quarter, reaching $17.0 million, with a sequential operating margin improvement of 130 basis points[4] - Selling, engineering, and administrative expenses decreased by 11% year-over-year, reflecting cost reduction actions across the business[8] - The company is focusing on selective capital expenditures and cost control measures to navigate the uncertain tariff environment[20] - The company is evaluating plans to move additional production activities to its Tijuana facility in 2025[45] - Restructuring activities related to the creation of new Regional Operational Centers of Excellence are complete, with further optimization plans for European operations ongoing[45] Market Performance - Sales in the APAC region increased by 24% year-over-year, while EMEA saw a 20% sequential increase[8] - Hydraulics segment net sales were $126.4 million, down 11% from $142.4 million in the previous year[38] - Electronics segment net sales remained relatively stable at $69.1 million, a slight decrease from $69.6 million year-over-year[38] - The impact of foreign currency translation on net sales was $2.3 million, with constant currency net sales showing a decline of 7%[49] Future Outlook - Adjusted EBITDA margin is projected to be between 17.5% and 18.5% for the second quarter of 2025[24] - Diluted Non-GAAP EPS is expected to range from $0.46 to $0.54 for the second quarter of 2025[24] - Helios Technologies aims to be a leading provider in niche markets through innovative product development and acquisitions[23] - The company is focused on investing in innovation and new product development while optimizing its manufacturing strategy to navigate tariff challenges[4] - Helios Technologies continues to focus on integrating recently acquired businesses, with no acquisition integration costs reported for Q1 2025[46]